Our sustainability experts, Andrew Tasker and Tanya Lloyd Jones, explain how businesses can prepare for the implementation of the UK Sustainability Reporting Standards ahead of the anticipated ruling in autumn 2026.
Following the UK Sustainability Reporting Standards (UK SRS) consultation process, the UK government has now published the finalised versions of UK SRS S1 and UK SRS S2. The standards are available for voluntary use, by any entity that chooses to do so.
- UK SRS S1: Establishes a general framework for applying UK SRS and requirements on general sustainability-related risks and opportunities
- UK SRS S2: Sets out requirements on climate-related risks and opportunities
Now, the government and the Financial Conduct Authority (FCA) will consider whether to introduce requirements for certain UK entities to report against these standards, with a final ruling expected in autumn 2026.
The FCA proposes replacing existing Task Force on Climate-Related Financial Disclosures (TCFD)-aligned Listing Rule requirements with reporting aligned to the Government’s draft UK SRS. Compliance with existing TCFD requirements sets a strong foundation for UK SRS compliance. Climate disclosures (UK SRS S2) would be mandatory (with limited transitional relief), and wider (non‑climate) sustainability disclosures (UK SRS S1) and Scope 3 emissions would be on a “comply or explain” basis. Companies must also disclose whether they have published a transition plan and whether they obtained third‑party assurance. The first UK SRS reporting periods that trigger the rules begin on or after 1 January 2027 (with specified transitional reliefs).
Key points for London Stock Exchange (LSE)-listed companies
Your organisation should prepare and update integrated disclosures covering governance, strategy, risk management, and targets for sustainability overall (UK SRS S1) and for climate specifically (UK SRS S2).
UK SRS S1 and UK SRS S2 should be applied at the same time. In limited circumstances, entities may initially disclose only climate-related information (a permitted transitional option) but must disclose use of that provision.
If you claim compliance with the UK SRS, you must make an explicit unreserved statement of compliance and disclose any permitted reliefs used.
Transition rules from the Standards
An entity is not required to disclose comparative information in the first annual reporting period it applies UK SRS S1 or UK SRS S2.
An entity may:
- Use a greenhouse gas (GHG) measurement method other than the GHG Protocol in its first year if that was the method previously used
- Be exempt from disclosing Scope 3 emissions in the first year. Continued use of reliefs for subsequent comparative information is permitted but must be disclosed alongside the statement of compliance
Application of the Standards is subject to any rules or implementation timetables in UK law, the Companies Act 2006, or by the FCA—i.e., legal or regulatory mandates may set which entities must apply SRS and when.
The FCA will require issuers to state whether they have published a transition plan and where, or to explain why they have not. This is not the same as mandating a particular form of transition plan, but it increases transparency expectations and investor scrutiny. UK SRS S2 already focuses on transition planning, so this FCA requirement strengthens the market expectation to have an explicit plan.
Practical compliance timelines and milestones for LSE-listed companies
The UK SRS S1/S2 documents set the reporting content and transition reliefs but do not themselves create an enforcement date for all companies. Application of mandatory disclosure will depend on UK legislation and regulatory rules (Companies Act / FCA). Clients should verify the exact regulatory timetable that applies to their listing class. The steps below illustrate how to prepare for the next annual reporting cycle.
Immediate
(0-3 months)
- Undertake a gap analysis and check regulatory scope, effective date, confirm first year relief applicability
- Assign governance (Board and Management)
- Run materiality assessment
Short Term
(3-6 months)
- Build and refresh GHG inventory (Scopes 1 & 2 and relevant Scope 3)
- Complete or refresh scenario and resilience analysis
- Select metrics tied to material risks and opportunities, including GHG targets and internal KPIs
Medium Term
(6-12 months)
- Map reporting to S1 (general requirements) and S2 (climate)
- Draft clear compliance position and disclose any transitional reliefs relied upon
- Prepare for GHG inventory assurance
Recommendations for the following 1-3 years
If you used first-year reliefs (e.g., no Scope 3, alternate GHG method), develop a multi-year plan to meet full UK SRS S2 expectations (including transition to GHG Protocol approaches and Scope 3 measurement where material).
Embed sustainability into strategic and financial planning cycles and remuneration if relevant (UK SRS S2 references oversight of targets and how they link to remuneration).
To comply with UK SRS S1 and UK SRS S2, you must prepare:
- Board level identification for sustainability/climate oversight: updated terms of reference and documented oversight processes
- Management governance and delegated roles with documented controls and reporting lines
- Materiality assessment and mapping of material sustainability/climate matters to cash-flow/financial impacts (short, medium, long definitions)
- Documented strategy disclosures: identified climate risks/opportunities, impacts on business model/value chain, and any transition plan
- Risk management disclosures: how climate risks are identified, assessed, and integrated into enterprise risk managemen
- Metrics & targets: GHG inventory (Scope 1 & 2), plan for Scope 3, definition of metrics, baselines and targets, and tracking methodology. If relying on first-year reliefs, clearly document and disclose this
- Controls, data lineage and audit trail to support verifiability and potential external assurance
- Draft statement of compliance and disclosures of any reliefs or legal constraints used
Recommended first deliverables for the board and audit committee
- Board briefing paper summarising UK SRS S1 and UK SRS S2 obligations, any regulator-provided deadlines for your entity, and recommended transitional relief (if any)
- Gap Analysis into current disclosures and roadmap to full compliance. This could look into governance updates, materiality assessment, GHG inventory (Scope 1 & 2) and Scope 3 plan, scenario analysis inputs, and a draft UK SRS-aligned disclosure to review
- Data controls to enable assurance (evidence capture, data owners and processes)
How we can help
Our team of specialists support clients at every stage of their environmental, social, and governance (ESG) journey, combining technical depth with strategic insight to help organisations build resilience, meet regulatory requirements, and align operations with stakeholder expectations.
Our ESG experts support strategy design and implementation, data collection and reporting, performance benchmarking, and due diligence. Drawing on our Leading with Science® approach, we create strategies that integrate sustainability into core business operations to protect value and foster innovation.
About the authors
Andrew Tasker
Andrew Tasker is an associate director with more than 10 years of experience in sustainability and climate change.
As part of the sustainability team helping corporations navigate the transition to a low carbon, resilient future, Andrew leads end-to-end climate and sustainability programs—developing corporate climate strategies, establishing scope 1–3 measurement and reduction frameworks, setting science based targets, and embedding ESG considerations into business planning and reporting. Andrew is adept at working with executive leadership, investors, supply chains, and regulators, combining policy fluency, carbon accounting expertise, and pragmatic program management to turn sustainability commitments into credible results.
Andrew is experienced in assessing the impacts of climate change and carbon footprint analysis at both project, including DCO scale, and organisational levels. He is the co-author of the latest IEMA (now ISEP) Assessing Greenhouse Gas Emissions and Evaluating their Significance Guidance and a member of the ISEP Working Group. Andrew acts as Expert Witness for hearings, examinations, and inquiries a climate change and sustainability leads.
Tanya Lloyd Jones
Tanya Lloyd Jones, Director – Sustainability, has more than 30 years’ experience as an environmental and sustainability professional.
Responsible for the management of a wide range of corporate responsibility, sustainability and environmental management projects, Tanya’s expertise covers ESG strategies, stakeholder reviews and benchmarking, and verification and assurance of sustainability reports and greenhouse gas statements. Working with clients to undertake the initial review of their activities, she identifies the most appropriate strategy, assists in its implementation, and supports internal resource as the strategy embeds within the organisation. She is a Chartered Environmentalist, a full Member of IEMA, and a BREEAM Accredited Professional (AP).